Permanent Index (PI)

The Permanent Index (PI) represents the foundational economic core of the AO Ecosystem, serving as an on-chain, permissionless, autonomous index.

Permanent Index (PI): Overview

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PI consists of an equally weighted tri-part asset composition:

• ⅓ $AO Token

• ⅓ $AR Token

• ⅓ Fair Launched Ecosystem Assets (FLPs)

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Foundation

The Permanent Index maintains its composition according to the following equation:

$$PI = \frac{1}{3}AO + \frac{1}{3}AR + \frac{1}{3}\sum_{i=1}^{n}FLP_i$$

Where:

$$\begin{aligned} AO,\ AR &= \text{fixed proportions of the total index} \\ FLP_i &= \text{individual Fair Launched Project assets dynamically} \\ &\quad\text{selected based on market criteria} \end{aligned}$$

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Mint

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Overview of Key Parameters

Notation	Description	Example
$AO$	The $AO Token	-
$AR,\ FLP_i$	Underlying assets held by $PI$	-
$PI$	Current circulating supply of $Pi tokens	10,000
$V_{\Pi}$	Total value (in $AO) of all assets held by PI	20,000
$AO_{u}$	Amount of $AO delegated by a user	600
$AO_{p}$	Amount of $AO delegated by a project	1,200

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Token Minting Mechanism (Proportional Issuance)

When $AO$ tokens are delegated to $\Pi$, they're immediately divided into three equal portions:

• One-third remains as $AO

• One-third is used to acquire $AR

• One-third is invested into selected Fair Launched Project assets ($FLP_i$).

The amount of $\Pi$ tokens minted is proportional to the user's contribution relative to the total value of assets within the index.

Formula (for Users):

$$\Pi_{u} = \frac{AO_{u} \times \Pi}{V_{\Pi}}$$

Example:

$$\begin{aligned} \text{For }AO_{u}&=600,\quad \Pi=10{,}000,\quad V_{\Pi}=20{,}000:\\ \Pi_{u}&=\frac{600\times10{,}000}{20{,}000}=300 \end{aligned}$$

Interpretation: A user delegating 600 AO tokens receives 300 new $\Pi$ tokens, reflecting their proportional share of the index's total assets.

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Token Minting for Fair-Launched Projects

Projects launching via Fair Launch similarly delegate $AO$ tokens, split equally into the three asset categories. Their issued tokens also maintain proportional fairness.

Formula (for Projects):

$$\Pi_{p} = \frac{AO_{p} \times \Pi}{V_{\Pi}}$$

Example:

$$\Pi_{p}=\frac{1,200 \times 10,000}{20,000}=600$$

Interpretation: A project receives 600 $\Pi$ tokens upon delegating 1,200 AO tokens.

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